Selling your business is a big decision. Whether you’re planning to retire, return to working for someone else, or pursue your next business idea.
Here are the top five common mistakes to avoid when selling a small business:
1. Overlooking due diligence – Due diligence is a critical process for the buyer and the seller. Failing to thoroughly assess and provide accurate financial, operational, and legal aspects about your business can lead to serious legal disputes during the sale process.
2. Inadequate documentation –As the seller, you must ensure that all business records, contracts, licenses, and other relevant documents are accurate, up-to-date, and readily available for potential buyers.
3. Incorrect business valuation – Setting an unrealistic price (whether too high or too low) can deter buyers or result in you not receiving the value your business deserves. Ensure that the price reflects the true worth of your brand, assets and the effort you’ve invested in building the business.
4. Lack of transition plan – Congratulations, you have sold your business! Now it’s up to you to ensure the new owners don’t stumble on their way in. Make sure you have a comprehensive transition plan that addresses any and all handover of assets, employees, customer relationships, and other key aspects of the business.
5. Insufficient legal advice – Selling a business of any size is a complex legal matter and it’s vital you have the right advice. In addition to financial considerations, there are a lot of legal implications from a compliance and financial perspective. Cutting corners on legal advice can lead to costly mistakes.
Here at GLG Legal Brisbane, our team of corporate law experts are ready to assist you. Whether this is your first time selling a business or one of many, we are here to ensure you achieve the best possible outcome.
Make an appointment with our office today, by calling: (07) 3161 9555 or email: info@glglegal.com.au